Tilray, the Canadian cannabis company and owner of Atlanta-based SweetWater Brewing, has struck a deal to acquire San Diego-based Green Flash Brewing and Alpine Beer Company.
News of the deal was broken by San Diego Beer News, which reported that the announcement was made internally on Friday.
Several sources confirmed the acquisition to Brewbound. A SweetWater spokesperson said an official announcement is forthcoming.
Five years ago, Green Flash was the 37th-largest craft brewer by volume according to the Brewers Association (BA), but its sales have diminished rapidly since then. In 2016 – a year that saw the opening of its 58,000 sq. ft. East Coast production facility in Virginia Beach, Virginia, with 100,000 barrels of capacity – the company produced 91,040 barrels.
By 2020, Green Flash’s output had evaporated to 34,000 barrels, according to the BA. The company laid off a “meaningful portion” of its staff in March 2020 as the COVID-19 pandemic forced the closure of taprooms, bars and restaurants. Among those let go at the time was Shawn Mcilhenney, brewmaster of the Alpine Beer brand, which Green Flash acquired in 2014 from founder Pat and Val Mcilhenney, Shawn’s parents. Earlier this year, the Mcilhenneys opened Mcilhenney Brewing in Alpine’s original location after Green Flash vacated the space.
During one tumultuous stretch in 2018, Green Flash shuttered its Virginia Beach location and laid off 43 employees, one month after announcing the $20 million project resulted in a “considerable amount of debt.”
The production facility, as well as all of its brewery equipment, was acquired by Atlanta, Georgia-headquartered New Realm Brewing in April 2018. While financial details of the sale were not disclosed, a source at the time told Brewbound the equipment alone could have been sold for more than $4 million.
Along with closing the new location, Green Flash pulled out of distribution in 10 states – two months after pulling out of 32 states – cutting its distribution network down to Arizona, California, Colorado, Hawaii, Nevada, Texas, Utah and Nebraska. At the time, the company said in a press release that it had secured new capital from a then-undisclosed investor group “committed to maintaining Green Flash’s status as an iconic independent craft-brewing interest.”
Weeks after announcing the facility’s closure, Green Flash said that Comerica Bank, its largest lender, had foreclosed on its loans and sold the company’s assets to investor group WC IPA LLC, which still owns it today.
Green Flash opened a taproom in Lincoln, Nebraska in June 2018, which it closed in November 2019.
This is the second acquisition announcement this month for SweetWater’s parent company Tilray. The Canadian cannabis firm announced December 8 that it had acquired Breckenridge, Colorado-based craft spirits-maker Breckenridge Distillery. With the announcement, Tilray said it intends to create cannabis-infused, non-alcoholic distilled spirits, pending federal permissibility.
In May, Tilray completed a merger with Aphria, Inc. to create the world’s largest global cannabis company, valued at $3.8 billion. Aphria acquired SweetWater in 2020 – two weeks before the planned merger was announced – for $250 million in cash and $50 million in Aphria stock.
Since the merger, SweetWater has expanded west, opening a taproom at Denver International Airport and acquiring the former Red Truck brewery in Fort Collins, Colorado. Additionally, the brewery partnered with Publix to add 450 distribution points in its home state of Georgia.
In October, Tilray reported a net revenue increase of 43% from $117 million to $168 million for the first quarter 2022, ending August 31. It also reported $15 million in net beverage alcohol revenue for the quarter. During the earnings call detailing the increases, Tilray chairman and CEO Irwin Simon said the company’s goal is to become a $4 billion business in the next three years, which he said is possible regardless of federal cannabis legalization in the U.S.
Tilray now supports more than 20 brands in more than 20 countries, ranging from cannabis offerings, to hemp-based foods, to alcoholic beverages, including both craft beer and spirits.